Date
23 October 2017

HKEJ Today: Highlights

Following is a summary of major news and comments in the Hong Kong Economic Journal, the parent publication of EJ Insight, on Friday, Feb. 21:

TOP STORIES

Analysts see gaming, e-commerce potential in WhatsApp after Facebook deal

WhatsApp Inc. may generate an extra US$1.5 billion to US$2 billion revenue each year by tapping into mobile gaming, e-commerce and other social media functions like its rivals Tencent Holdings Ltd. (00700.HK) and LINE app of Naver Corp., also known as NHN, after it is acquired by Facebook Inc., analysts said. The world’s biggest social platform has unveiled a US$19 billion plan, the largest deal in the sector in 10 years, to take over the messaging app operator, which has 450 million users globally.

China flash PMI hits seven-month low, HSBC says

The flash Markit/HSBC Purchasing Managers’ Index for China in February has hit a seven-month low at 48.3, showing signs of contraction again in the country’s industrial activities. Economists said the readings of sub-indexes of the private leading indicator reflects downside risks in China’s growth and rising pressure on inflation. They expect Beijing to keep a slightly tight monetary policy stance.

CSPC Pharmaceutical aims to benefit from aging China population

Interview: CSPC Pharmaceutical Group Ltd. (01093.HK) is eyeing US$1 billion annual sales for each of its signature products, given the aging population in China, said chairman Cai Dongchen {蔡東晨}. The company has earmarked 300 million yuan (US$49.32 million) each year for product development, in a bid to launch seven to eight new types of drugs every year, Cai said, adding that it, however, has no plan to acquire hospital chain like what some rivals, such as Shanghai Fosun Pharmaceutical (Group) Co. Ltd. (02196.HK), did.

POLITICS

Carrie Lam plans to host dinner for pan-democrats and Liaison Office officials

Hong Kong Chief Secretary Carrie Lam plans to act as the conduit between the central government’s Liaison Office and the city’s pan-democratic legislators to help ease tensions in their relations by hosting a dinner at her official residence. It followed a failed attempt by the Liaison Office to host a banquet for all legislators after the pan-democrats said they would not attend if it was held at the office’s headquarters in Western District. Three major pan-democratic parties, including the Democratic Party, Labour Party and the Civic Party reacted positively to Lam’s initiative.

Tien’s call to limit number of mainland visitors ‘selfish’, mainland paper says

The official Global Times singled out a pro-government legislator, Michael Tien, for attack over his plan to propose curbing the number of mainland visitors to Hong Kong at the upcoming National People’s Congress plenum. It said in an article yesterday that the proposal was “selfish”. The idea of limiting the number of mainland visitors was aimed at giving skewed benefit to Hong Kong from the travel scheme, but would hurt the feelings of mainland people, it said. The move would also entail huge administrative cost for mainland authorities, it said.

EDITORIAL

China manufacturing slowdown poses risk to overall growth

The HSBC China Flash Manufacturing Purchasing Managers Index (PMI) fell to a seven-month low of 48.3 in February. Taken together with some recent economic data, the downtrend of China’s economic growth in the last quarter of 2013 is expected to continue in the first three months of this year. Faced with pressure of a slowing economy, Beijing may adopt fine-tuning policies to maintain appropriate flexibility in liquidity in order to keep the pace of growth. The fall of PMI into the contraction zone (below 50 out of 100) two months in a row has raised alarm bell of the risk of a sharp fall in the economic growth rate.

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